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Forced Arbitration

Hidden in the fine print of many consumer contracts - from credit cards and cell phone contracts to nursing home care and employment contracts - are dangerous forced arbitration clauses. Consumers and employees are often forced to sign these clauses in order to receive services or get hired and often don't know they've signed-away their legal rights until it is too late.

In the event of a dispute with the corporation, forced arbitration says that a consumer or an employee cannot take their case to court but instead has to go to a private arbitration forum designed by the very corporation the dispute is against.

How Americans Are Hurt By The Fine Print:

One-sided Requirements - Most forced arbitration clauses require the consumer to waive their rights, while allowing the corporation to sue in court.

High Costs - Consumers often must pay steep filing fees just to initiate a case and pay their share of the arbitrator’s hourly charges. In addition, forced arbitration clauses often allow the corporation to choose the location, regardless of how inconvenient or costly travel will be for the consumer.

Biased Decision-Makers - Since only businesses are repeat users of an arbitrator, there is a disincentive for an arbitrator to rule in favor of a consumer if he expects further retentions.

Weak Civil Justice Safeguards - Forced arbitration clauses often severely restrict the individual’s ability to argue his or her side of the case. For example, many restrict the individual’s ability to obtain necessary evidence. Also, it is nearly impossible to appeal adverse decisions by arbitrators.

Secret Backroom Proceedings - While proceedings and records of the courts are open to the public, most forced arbitration clauses require that proceedings be kept confidential, even if the case raises important public health and safety issues.